There isn't a copy entity function per se. You could export the contact entity and edit the configuration xml by hand to create something nearly identical but there are a few relationships/fields you wont'be be able to include (like customer) because they are system entities and not enabled for use by custom entities. The contact entity is also linked to many other entities in the system which may make this undesireable when you try to create your custom entity.
Normally, this is not a recommended approach. Usually if a client needs to create a segregated list we use something like Customer Type code and then adjust the views and filters to show them appropriately so it is only displaying one type. There are other approaches as well depending on the need.